A tale of two Toy Buildings

May 17, 2011 09:55AM

alternate textThe former Toy Building at 1107 Broadway and developer Yitzchak Tessler (building photo source: PropertyShark)

The estate of Lehman Brothers believes the 200 Fifth Avenue part of the former International Toy Center has already rebounded enough to be worth unloading, but its vacant sister building at 1107 Broadway is a different story entirely. According to the Post, the bank’s scheduled June 6 foreclosure auction of $137 million in mezzanine debt at the 16-story property doesn’t mean it will breathe new life any time soon. “The foreclosure is really to pressure the owners to make a comprehensive deal,” one source explained. “Lehman has to put the debt on the market, but it isn’t something you’d likely buy because then you’d still have to get control of the senior loan,” another said. While 200 Fifth was able to snag swanky new tenants like Eataly, Tiffany’s and Grey Group following the Lehman collapse, a condo conversion plan fell through at the other Toy Building, next door’s 1107 Broadway, which is owned by a partnership led by Yitzhak Tessler that also includes investor Joseph Chetrit. Lehman holds $343 million in debt at 1107 Broadway, “but Tessler’s likely to claim that Lehman defaulted on him when it filed for bankruptcy,” a source said. [Post]